Confusion reigns on Obamacare’s first day

SoVaNow.com / October 02, 2013

With Tuesday’s debut of the new Virginia health insurance exchange, local insurance agents were left scratching their heads as they attempt to decipher the workings of the Affordable Care Act, better known as Obamacare, which promises to provide affordable coverage to the millions of Americans who lack insurance.

Local agents have been fielding calls over the past few weeks, but until Tuesday they were unable to obtain basic information on the rates or the types of coverage offered through the new exchange — located on the Internet at wwwhealthcare.gov.

Billy Wells of Hughes, Gregory & Wells Insurance in Chase City said he’s taken several courses and two tests to prepare himself for Obamacare, but even he felt unprepared for the barrage of questions, comments and concerns from members of the public who are either seeking coverage for the first time or hoping to find a better deal.

The website set up to handle inquiries on the federal exchange — which will serve Virginia residents in the absence of a state-run exchange — offered little help yesterday: the site frequently locked up as traffic spiked on the first day.

Visitors to http://www.healthcare.gov were greeted with the following message throughout the day Tuesday: “Health Insurance Marketplace: Please wait. We have a lot of visitors on our site right now and we’re working to make your experience here better. Please wait here until we send you to the login page. Thanks for your patience!”

Once the log-in page appeared, the site failed to properly load, leaving those who had not previously created an account unable to access any information beyond the basic Q & A. Or if it did load most received this message “Important: Your account couldn’t be created at this time. The system is unavailable. Try Again.”

Enrollment began yesterday, but there is time for the site to work out the bugs. The enrollment period for coverage on the health exchange doesn’t end until March 31, 2014.

The successful few who got through on the site soon discovered several weaknesses with Obamacare.

Of the 8 or 9 companies selling insurance on the exchange in Virginia, only three have a local presence — meaning they allow residents to access medical care through a local physician or medical facility. Those three are Anthem, Optima and Aetna. Most often, these three were not the lowest priced providers.

Also, most of the policies are HMO’s — a plan which restricts patients to an approved list of doctors, hospitals and other health care providers.

People who already have insurance, either individually or through their employer, are not required to participate in the exchange. The system primarily is designed to provide insurance for low- and moderate-income individuals and families that either don’t have coverage or want to improve the coverage they do have.

A family of four whose annual income exceeds 400% of the federal poverty level — about $94,200 a year — can purchase coverage off the exchange for around $600 per month, according to one agent who asked not to be named. That same family of four is looking at monthly premiums in excess of $1,400 if they purchase coverage on the exchange.

However, for four-person households with income below $94,200, the cost of insurance is reduced by federal tax credits. In Virginia, a household with an annual income of $50,000 would pay $282 per month, on average, for the lowest cost mid-range plan offered through the exchange.

The healthcare.gov website does not make it clear that people have the option of purchasing insurance through the insurance exchange or outside the exchange (the tax credits are available only through the exchange). Wells says before making a decision, shoppers should explore both options — making certain they are getting the most coverage for the fewest dollars.

For those who spent Tuesday hoping to gain access to the marketplace without success, here’s what to expect once the marketplace is open. You will need to provide details of your family’s income, household size, and job status. You must also acknowledge that you are a legal resident of the United States. The program automatically verifies your responses against databases maintained by the Social Security Administration, the Internal Revenue Service, Department of Labor and Homeland Security.

If it works as planned, the exchange would then then calculate the premiums and the subsidies you can get from the federal government to defray the cost of medical coverage.

It is then up to you to decide whether you wish to pay a high deductible and low premium, or less out of pocket but higher premium. After that, you can even initiate the process of purchasing a policy online.

The best piece of advice Wells offered for those seeking to purchase insurance may be to contact a local agent who can lay out all options. His other advice for those who want to go it alone, wait a few days for the traffic to die down and the glitches in the system to work out. As long as you are enrolled by December 15, 2013, your coverage is effective January 1, 2014, the date by which all not exempted, non-insured Americans must have coverage or face a penalty under Obamacare’s individual mandate to carry insurance or pay a fine. The minimum fine in 2014 is $95, rising in subsequent years.